Shopping Center Management: 5 Ways Proper Common Area Maintenance Can Lead to Increased Rent
A high-quality shopping center draws in crowds, providing a space for people to gather, shop, and fulfill various needs. Besides creating a desirable tenant-mix, a clean, safe, and aesthetically pleasing environment generates foot traffic, ultimately generating additional revenue for your tenants, finally leading to increased rent for the property owner. One key to maintaining this flow of traffic and repeat customers lies in the upkeep of the shopping center’s common areas. In real estate we simply call the term Common Area Maintenance, also known as CAM. CAM on a basic level involves keeping common areas like parking lots, landscaping, and sidewalks clean and well-kept. This enhances aesthetic appeal, improves safety and security, extends the longevity of infrastructure, promotes a positive brand image for the shopping center and its tenants, and increases customer dwell time and spending. For high-end or trophy shopping centers, common area maintenance could additionally include, changing out seasonal decor, maintaining a small park, maintaining outdoor seating for a food hall, hosting various events such as live music and more! Let's explore how these factors contribute to more customers, happier tenants and increased rent.
Enhanced Aesthetic Appeal.
Clean spaces increase customer and tenant satisfaction.
Clean and attractive spaces are crucial for drawing in shoppers. People prefer to spend time in places that are tidy and safe. When shopping centers maintain their appearance, tenants and their employees enjoy working in these pleasant environments. As business increases, higher rent becomes less of an issue.
Example: A shopping center who invests in landscaping may see a rise in foot traffic from cars pulling off the road and thus tenant lease renewals.
2. Improved Safety and Security
Having tenants and shoppers in a secure and safe area is a great way to generate business.
Regular maintenance reduces potential hazards, making the shopping center safer for everyone. Shoppers feel secure and can focus on their shopping, while tenant employees have a safe place to work and relax during breaks. This sense of security makes the center more appealing to potential tenants.
Example: Incidents of accidents and claims are reduced after implementing regular maintenance schedules. This may lower the cost of insurance for tenants and the property owner.
3. Positive Brand Image and Reputation.
Customers are more likely to return to an establishment with a positive image. Positive reputation also lead to more tenants.
A positive brand image is vital for any business. A well-maintained shopping center contributes to this by ensuring cleanliness and order. Tenants and customers associate these qualities with the center, boosting its reputation and attracting high-end retailers willing to pay premium rents.
Example: A shopping center gained a reputation for cleanliness and quality, leading to increased demand for retail spaces.
4. Increased Customer Dwell Time and Spending.
Increasing customers comfort leads to them spending more. time at your business.
Attractive and comfortable common areas encourage shoppers to stay longer. The longer they stay, the more they spend, leading to increased business. Additional amenities lead to higher dwell time. Higher sales from increased dwell time justify higher rent potential when you market the center to new or existing tenants.
Example: Shopping centers that implemented electric car charging stations showed an increase in dwell time and thus retail tenants had higher sales revenue. Additionally, the property owner can generate revenue from the EV charging stations.
5. Efficient Parking Lot Design
A parking lot design has the potential to make or break a business.
An efficiently designed and maintained parking lot significantly impacts customer experience. A complicated or unsafe parking lot can deter customers. Conversely, a well-thought-out parking lot improves customer convenience, encouraging them to return and increasing business.
Example: Analysis of customer flow and tenant feedback showed positive results after re configuring and maintaining the parking lot. Cars that can get in and out quicker and more safely, allowed for new customers to take up those spaces increasing retail tenants’ daily revenue.
In conclusion, proper common area maintenance enhances aesthetic appeal, improves safety and security, fosters a positive brand image, increases customer dwell time and spending, and ensures efficient parking lot design. These factors lead to higher customer and tenant satisfaction, enabling the possibility of increased rent without negatively impacting tenants. A well thought out CAM strategy can also help you to make money by offering additional amenities such as EV charging stations.
If you are in need of commercial property management services for your shopping or retail center please reach out to Realicore, we are happy to step in and lend a hand. Contact us.
